The Nifty Bank managed to reclaim crucial resistance levels and any dips towards 47,000 could be used as a buying opportunity. Federal Bank, HDFC Bank, AU Small Finance Bank, and Bandhan Bank rose more than 1% each.
Kotak Mahindra Bank, Axis Bank, and HDFC Bank rose over 1% each while Bank of Baroda, PNB, SBI, and Bandhan Bank saw selling pressure. Bouncing back, Nifty Bank rose 185 points to close at 46,785
PNB, Axis Bank, IndusInd Bank, and Federal Bank were the top gainers. The Nifty Bank found some resistance around the 20-DMA on the daily chart. A close below 46,406, which is also the 50-DMA, could trigger a fresh round of selling.
Data suggests that most of the banking stocks that are part of the Nifty Bank index witnessed a short buildup, which implies banking stocks could remain under pressure in the next few days as well.
The Nifty Bank fell over 1% on Monday as traders preferred to book profits at higher levels. The index fell more than 500 points to close at 47,327 while the Nifty50 was down 160 points to close the session at 22,332.